Earnings release
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Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance August 6, 2025 Generated second quarter net income of $74.4 million and Adjusted EBITDA of $242.9 million Commenced commissioning at the Kings Landing Complex (“Kings Landing”) with full commercial in-service expected in late September 2025, providing long overdue relief for producers with material curtailed production on the Delaware North system and allowing for resumption of new development activity Updating the Company’s 2025 Adjusted EBITDA Guidance range to $1.03 billion to $1.09 billion Continue to expect fourth quarter 2025 annualized Adjusted EBITDA of approximately $1.2 billion Narrowing the 2025 Capital Guidance range to $460 million to $530 million, including growth and maintenance Began construction of the ECCC Pipeline, connecting the western portion of Kinetik’s system between Eddy and Culberson counties and providing further critical rich gas takeaway capacity relief for the Delaware North system HOUSTON & MIDLAND, Texas--(BUSINESS WIRE)-- Kinetik Holdings Inc. (NYSE: KNTK) (“Kinetik” or the “Company”) today reported financial results for the quarter ended June 30, 2025. Second Quarter 2025 Results and Commentary For the three and six months ended June 30, 2025, Kinetik reported net income including noncontrolling interest of $74.4 million and $93.7 million, respectively. Kinetik generated Adjusted EBITDA of $242.9 million and $493.0 million, Distributable Cash Flow of $153.3 million and $310.3 million, and Free Cash Flow of $7.9 million and $128.3 million for the three and six months ended June 30, 2025, respectively. For the three months ended June 30, 2025, Kinetik processed natural gas volumes of 1.75 Bcf/d. “Kinetik navigated both successes and challenges in the second quarter of 2025,” said Jamie Welch, Kinetik’s President & Chief Executive Officer. “First and foremost, I am incredibly proud of our team’s focus on operational execution and meeting our customers’ needs during a period marked with macroeconomic uncertainty and market volatility. For the quarter, we reported Adjusted EBITDA of $243 million with processed gas volumes growing 11% year-over-year. That growth was partially offset by lower commodity pricing and higher operating costs.” “Kinetik’s earnings trajectory remains weighted to the second half of 2025 with the full in-service of Kings Landing. The associated return of curtailed production and customer development activity at Delaware North will result in material processed gas volume growth throughout the fourth quarter of this year and into 2026.” Welch continued, “With the expected in-service timing for Kings Landing, some delays in producer development activity to early 2026, as well as commodity price headwinds and associated operating cost increases, particularly relating to rental equipment and electricity, we are updating our full year 2025 Adjusted EBITDA Guidance range to $1.03 billion to $1.09 billion.” “Capital Expenditures were $126 million in the second quarter as we started commissioning Kings Landing. We now anticipate Capital Expenditures to be more weighted to the third quarter of 2025 driven by timing of Kings Landing completion. We are narrowing full year Capital Guidance to $460 million to $530 million, including growth and maintenance Capital Expenditures and any contingent consideration tied to the final cost of Kings Landing.” 1 1 1,2 1 1 1 1 1 3 3 3 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 1/8
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“Looking ahead, Management remains confident in Kinetik’s value proposition as we continue to see numerous commercial opportunities with both new and existing customers that are highly synergistic to our existing footprint and accretive to our business in 2026 and beyond.” Financial . Achieved quarterly net income of $74.4 million and Adjusted EBITDA of $242.9 million. . Repurchased $172.8 million of Class A common stock year to date under the existing Repurchase Program, of which $72.6 million was repurchased during the second quarter of 2025. . Completed refinancing of the Company’s Term Loan A and Revolving Credit Facility, extending maturities to May 30, 2028 and May 30, 2030, respectively. . Exited the quarter with a Leverage Ratio per the Company’s Credit Agreement of 3.6x and a Net Debt to Adjusted EBITDA Ratio of 4.0x. Selected Key Metrics Three Months Ended June 30, Six Months Ended June 30, 2025 2025 (In thousands, except ratios) Net income including noncontrolling interest $ 74,416 $ 93,678 Adjusted EBITDA $ 242,933 $ 492,950 Distributable Cash Flow $ 153,303 $ 310,284 Dividend Coverage Ratio 1.2x 1.2x Capital Expenditures $ 126,267 $ 204,341 Free Cash Flow $ 7,882 $ 128,275 Leverage Ratio 3.6x Net Debt to Adjusted EBITDA Ratio 4.0x Common stock issued and outstanding 156,322 June 30, 2025 March 31, 2025 (In thousands) Net Debt $ 3,943,567 $ 3,734,955 Operational and Construction . Commenced commissioning at Kings Landing with full commercial in-service expected in late September 2025. . Construction started on ECCC Pipeline with in-service expected during the first half of 2026. . Filed acid gas injection permit for Kings Landing with approval expected by the end of 2025. Governance and Sustainability . Listed Kinetik’s common stock on NYSE Texas while maintaining its primary listing on the New York Stock Exchange. . Published 2024 Sustainability Report highlighting the Company’s sustainability initiatives, progress, and achievements. . Infinium commenced construction on Project Roadrunner, an ultra-low carbon electrofuels production site, in Reeves County, Texas. Kinetik will be the long-term CO feedstock provider upon expected completion in 2027. 1 4 1,5 1,6 1 1 1,7 3 1 1,5 1,6 8 1,9 2 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 2/8
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Upcoming Tour Dates Kinetik plans to participate at the following upcoming conferences and events: . Citi Natural Resources Conference in Las Vegas on August 12th - 13th . Barclays CEO Energy-Power Conference in New York on September 3rd . PEP Energy Conference in Austin on September 29th . Wolfe Utilities, Midstream & Clean Energy Conference in New York on September 30th Investor Presentation An updated investor presentation will be available under Events and Presentations in the Investors section of the Company’s website at www.ir.kinetik.com. Conference Call and Webcast Kinetik will host its second quarter 2025 results conference call on Thursday, August 7, 2025 at 8:00 am Central Daylight Time (9:00 am Eastern Daylight Time) to discuss second quarter results. To access a live webcast of the conference call, please visit the Investors section of Kinetik’s website at www.ir.kinetik.com. A replay of the conference call will also be available on the website following the call. About Kinetik Holdings Inc. Kinetik is a fully integrated, pure-play, Permian-to-Gulf Coast midstream C-corporation operating in the Delaware Basin. Kinetik is headquartered in Houston and Midland, Texas. Kinetik provides comprehensive gathering, transportation, compression, processing and treating services for companies that produce natural gas, natural gas liquids, crude oil and water. Kinetik posts announcements, operational updates, investor information and press releases on its website, www.kinetik.com. Forward-looking statements This news release includes certain statements that may constitute “forward-looking statements” for purposes of the federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “seeks,” “possible,” “potential,” “predict,” “project,” “prospects,” “guidance,” “outlook,” “should,” “would,” “will,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These statements include, but are not limited to, statements about the Company’s future business strategy and plans, expectations, and objectives for the Company’s operations, including statements about strategy, synergies, sustainability goals and initiatives, portfolio monetization opportunities, expansion projects and the timing thereof, and future operations, and financial guidance; growth opportunities; the amount and timing of future shareholder returns; the Company’s projected dividend amounts and the timing thereof; and the Company’s leverage and financial profile. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties, which could cause our actual results, performance, and financial condition to differ materially from our expectations. See Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement whether as a result of new information, future development, or otherwise, except as may be required by law. 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 3/8
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Additional information Additional information follows, including a reconciliation of Adjusted EBITDA, Distributable Cash Flow, Free Cash Flow, and Net Debt (non-GAAP financial measures) to the GAAP measures. Non-GAAP financial measures Kinetik’s financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP financial information. It is management’s intent to provide non-GAAP financial information to enhance understanding of our consolidated financial information as prepared in accordance with GAAP. Adjusted EBITDA, Distributable Cash Flow, Free Cash Flow, Dividend Coverage Ratio, Net Debt and Leverage Ratio are non-GAAP measures. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP and reconciliations from these results should be carefully evaluated. See “Reconciliation of GAAP to Non-GAAP Measures” elsewhere in this news release. This news release also includes certain forward-looking non-GAAP financial information. Reconciliations of these forward-looking non-GAAP measures to their most directly comparable GAAP measure are not available without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various reconciling items that would impact the most directly comparable forward-looking GAAP financial measure, that have not yet occurred, are out of Kinetik’s control and/or cannot be reasonably predicted. Accordingly, such reconciliation is excluded from this new release. Forward-looking non- GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures. . A non-GAAP financial measure. See “Non-GAAP Financial Measures” and “Reconciliation of GAAP to Non-GAAP Measures” for further details. . A reconciliation of expected full year or annualized fourth quarter 2025 Adjusted EBITDA to net income (loss), the closest GAAP financial measure, cannot be provided without unreasonable efforts due to the inherent difficulty in quantifying certain amounts, including share-based compensation expense, which is affected by factors including future personnel needs and the future prices of our Class A Common Stock, which may be significant. . Net of contributions in aid of construction and returns of invested capital from unconsolidated affiliates. . Dollar value of Kinetik Class A common stock repurchased year to date as of August 6, 2025. . Leverage Ratio is total debt less cash and cash equivalents divided by last twelve months Adjusted EBITDA, calculated per the Company’s credit agreement. The calculation includes EBITDA Adjustments for Qualified Projects, Acquisitions and Divestitures. . Net Debt to Adjusted EBITDA Ratio is defined as Net Debt divided by last twelve months Adjusted EBITDA. . Dividend Coverage Ratio is Distributable Cash Flow divided by total declared dividends. . Issued and outstanding shares of 156,322,500 is the sum of 63,545,388 shares of Class A common stock and 92,777,112 shares of Class C common stock. Excludes 7,680,492 shares of Class C common stock issued on July 1, 2025 in connection with the Durango Permian acquisition. . Net Debt is defined as total current and long-term debt, excluding deferred financing costs, less cash and cash equivalents. KINETIK HOLDINGS INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 (In thousands, except per share data) Operating revenues: 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 4/8
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Service revenue $112,654 $ 96,415 $240,580 $198,610 Product revenue 311,590 260,102 624,095 496,669 Other revenue 2,494 2,940 5,326 5,572 Total operating revenues 426,738 359,457 870,001 700,851 Operating costs and expenses: Costs of sales (excluding depreciation and amortization) 156,697 146,513 380,061 300,200 Operating expenses 68,045 44,068 131,648 87,474 Ad valorem taxes 6,559 6,212 13,350 12,504 General and administrative expenses 24,244 31,091 61,836 65,227 Depreciation and amortization expenses 93,763 75,061 186,436 148,667 (Gain) loss on disposal of assets, net (25) (76) (65) 4,090 Total operating costs and expenses 349,283 302,869 773,266 618,162 Operating income 77,455 56,588 96,735 82,689 Other income (expense): Interest and other income 2,732 309 3,517 400 Loss on debt extinguishment (635) (525) (635) (525) Gain on sale of equity method investment — 59,884 — 59,884 Interest expense (56,514) (54,049) (112,228) (101,516) Equity in earnings of unconsolidated affiliates 58,705 55,955 116,183 116,424 Total other income, net 4,288 61,574 6,837 74,667 Income before income taxes 81,743 118,162 103,572 157,356 Income tax expense 7,327 9,214 9,894 13,001 Net income including noncontrolling interest 74,416 108,948 93,678 144,355 Net income attributable to Common Unit limited partners 50,771 71,756 63,903 95,613 Net income attributable to holders of Class A Common Stock $ 23,645 $ 37,192 $ 29,775 $ 48,742 Net income attributable to holders of Class A Common Stock, per share Basic $ 0.33 $ 0.54 $ 0.38 $ 0.68 Diluted $ 0.33 $ 0.54 $ 0.38 $ 0.67 Weighted-average shares Basic 61,721 59,792 60,946 58,840 Diluted 62,228 60,279 61,693 59,503 (1)Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $73.6 million and $54.7 million for the three months ended June 30, 2025 and 2024, respectively, and $135.8 million and $99.2 million for the six months ended June 30, 2025 and 2024, respectively, for certain volumes, where we act as principal. KINETIK HOLDINGS INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES Three Months EndedSix Months Ended June 30, June 30, 2025 2024 2025 2024 (In thousands) (1) 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 5/8
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Net Income Including Noncontrolling Interests to Adjusted EBITDA Net income including noncontrolling interest (GAAP) $ 74,416 $108,948 $ 93,678 $144,355 Add back: Interest expense 56,514 54,049 112,228 101,516 Income tax expense 7,327 9,214 9,894 13,001 Depreciation and amortization expenses 93,763 75,061 186,436 148,667 Amortization of contract costs 1,655 1,655 3,310 3,310 Proportionate EBITDA from unconsolidated affiliates 88,100 85,922 175,630 174,324 Share-based compensation 9,695 15,136 30,348 37,697 (Gain) loss on disposal of assets, net (25) (76) (65) 4,090 Loss on debt extinguishment 635 525 635 525 Commodity hedging unrealized loss — — — 6,883 Integration costs 2,433 2,510 5,971 2,551 Acquisition transaction costs — 3,232 — 3,232 Other one-time costs or amortization 5,186 2,581 11,792 5,006 Deduct: Interest income 318 310 1,108 887 Gain on sale of equity method investment — 59,884 — 59,884 Commodity hedging unrealized gain 37,743 8,205 19,616 — Equity income from unconsolidated affiliates 58,705 55,955 116,183 116,424 Adjusted EBITDA(non-GAAP) $242,933 $234,403 $492,950 $467,962 Distributable Cash Flow Adjusted EBITDA (non-GAAP) $242,933 $234,403 $492,950 $467,962 Proportionate EBITDA from unconsolidated affiliates (88,100) (85,922) (175,630) (174,324) Returns on invested capital from unconsolidated affiliates 63,604 75,429 126,941 152,642 Interest expense (56,514) (54,049) (112,228) (101,516) Unrealized gain on interest rate swaps (741) (189) (1,411) (9,566) Maintenance capital expenditures (7,879) (6,780) (20,338) (17,780) Distributable cash flow (non-GAAP) $153,303 $162,892 $310,284 $317,418 Free Cash Flow Distributable cash flow (non-GAAP) $153,303 $162,892 $310,284 $317,418 Cash interest adjustment (22,476) (29,144) 10,197 (29,395) Realized (loss) gain on interest rate swaps (2) 3,953 (344) 7,905 Growth capital expenditures (123,498) (32,160) (189,210) (80,413) Capitalized interest (4,555) (986) (7,859) (1,930) Investments in unconsolidated affiliates (97) — (985) (3,273) Returns of invested capital from unconsolidated affiliates 2,293 — 2,853 1,240 Contributions in aid of construction 2,914 894 3,339 1,408 Free cash flow (non-GAAP) $ 7,882 $105,449 $128,275 $212,960 KINETIK HOLDINGS INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED) Six Months Ended June 30, 2025 2024 (1) (2) (3) 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 6/8
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(In thousands) Reconciliation of net cash provided by operating activities to Adjusted EBITDA Net cash provided by operating activities $ 305,907 $ 279,222 Net changes in operating assets and liabilities 11,559 49,046 Interest expense 112,228 101,516 Amortization of deferred financing costs (3,984) (3,582) Current income tax expense 485 610 Returns on invested capital from unconsolidated affiliates (126,941) (152,642) Proportionate EBITDA from unconsolidated affiliates 175,630 174,324 Derivative fair value adjustment and settlement 21,027 2,683 Commodity hedging unrealized (gain) loss (19,616) 6,883 Interest income (1,108) (887) Integration costs 5,971 2,551 Acquisition transaction costs — 3,232 Other one-time cost or amortization 11,792 5,006 Adjusted EBITDA (non-GAAP) $ 492,950 $ 467,962 Distributable Cash Flow Adjusted EBITDA (non-GAAP) $ 492,950 $ 467,962 Proportionate EBITDA from unconsolidated affiliates (175,630) (174,324) Returns on invested capital from unconsolidated affiliates 126,941 152,642 Interest expense (112,228) (101,516) Unrealized gain on interest rate swaps (1,411) (9,566) Maintenance capital expenditures (20,338) (17,780) Distributable cash flow (non-GAAP) $ 310,284 $ 317,418 Free Cash Flow Distributable cash flow (non-GAAP) $ 310,284 $ 317,418 Cash interest adjustment 10,197 (29,395) Realized (loss) gain on interest rate swaps (344) 7,905 Growth capital expenditures (189,210) (80,413) Capitalized interest (7,859) (1,930) Investments in unconsolidated affiliates (985) (3,273) Returns of invested capital from unconsolidated affiliates 2,853 1,240 Contributions in aid of construction 3,339 1,408 Free cash flow (non-GAAP) $ 128,275 $ 212,960 KINETIK HOLDINGS INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED) June 30, March 31, 2025 2025 (In thousands) Net Debt Short-term debt $ 189,300 $ 148,800 Long-term debt, net 3,736,972 3,568,457 (1) (2) (3) (4) 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 7/8
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Plus: Debt issuance costs, net 28,028 26,543 Total debt 3,954,300 3,743,800 Less: Cash and cash equivalents 10,733 8,845 Net debt (non-GAAP) $ 3,943,567 $ 3,734,955 (1) Adjusted EBITDA is defined as net income including noncontrolling interest adjusted for interest, taxes, depreciation and amortization, gain or loss on disposal of assets and debt extinguishment, the proportionate EBITDA from our EMI pipelines, share-based compensation expense, noncash increases and decreases related to commodity hedging activities, integration and transaction costs and extraordinary losses and unusual or non- recurring charges. Adjusted EBITDA provides a basis for comparison of our business operations between current, past and future periods by excluding items that we do not believe are indicative of our core operating performance. Adjusted EBITDA should not be considered as an alternative to the GAAP measure of net income including non- controlling interest or any other measure of financial performance presented in accordance with GAAP. (2) Distributable Cash Flow is defined as Adjusted EBITDA, adjusted for the proportionate EBITDA from unconsolidated affiliates, returns on invested capital from unconsolidated affiliates, interest expense, net of amounts capitalized, unrealized gains or losses on interest rate swaps and maintenance capital expenditures. Distributable Cash Flow should not be considered as an alternative to the GAAP measure of net income including non-controlling interest or any other measure of financial performance presented in accordance with GAAP. We believe that Distributable Cash Flow is a useful measure to compare cash generation performance from period to period and to compare the cash generation performance for specific periods to the amount of cash dividends we make. (3) Free Cash Flow is defined as Distributable Cash Flow adjusted for growth capital expenditures, investments in unconsolidated affiliates, returns of invested capital from unconsolidated affiliates, cash interest, capitalized interest, realized gains or losses on interest rate swaps and contributions in aid of construction. Free Cash flow should not be considered as an alternative to the GAAP measure of net income including non-controlling interest or any other measure of financial performance presented in accordance with GAAP. We believe that Free Cash Flow is a useful performance measure to compare cash generation performance from period to period and to compare the cash generation performance for specific periods to the amount of cash dividends that we make. (4) Net Debt is defined as total short-term and long-term debt, excluding deferred financing costs, premiums and discounts, less cash and cash equivalents. Net Debt illustrates our total debt position less cash on hand that could be utilized to pay down debt at the balance sheet date. Net Debt should not be considered as an alternative to the GAAP measure of total long-term debt, or any other measure of financial performance presented in accordance with GAAP. Kinetik Investors: Alex Durkee (713) 574-4743 investors@kinetik.com Source: Kinetik Holdings Inc. 2025-08-07 10:30 Kinetik - Kinetik Reports Second Quarter 2025 Financial and Operating Results and Updates Full Year 2025 Guidance https://ir.kinetik.com/news/news-details/2025/Kinetik-Reports-Second-Quarter-2025-Financial-and-Operating-Results-and-Updates-Full-Year-2025-Guidance/de… 8/8